Israel Latest: Uproar Eases As Leaders Prepare for Talks

(Blumberg) —

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Israeli President Isaac Herzog called on Prime Minister Benjamin Netanyahu and opposition leaders to start talks immediately after the government stalled a controversial push to overhaul the judicial system.

The shekel rallied in early trade and institutions reopened after a day of unprecedented strikes and protests. In a show of international business-as-usual, BP Plc and the UAE’s state oil company made a non-binding offer to privatize Israel’s NewMed Energy worth around $2 billion.

But anti-government protest leaders have vowed to go ahead. Protesters for and against the planned overhaul clashed with police overnight. Opposition leaders have said they are ready for talks and preparing teams, but they want the government to scrap plans entirely that would severely weaken the country’s courts.

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Important Developments

(All times CET)

Wells Fargo sees “baby step” in the right direction (9:00 a.m.)

Late Monday’s developments “are a small step in the right direction,” said Brendan McKenna, a New York-based emerging markets economist and FX strategist at Wells Fargo Securities. “There is still a long way to go before political risk can be materially reduced and Israel’s asset prices can recover.”

Israeli asset prices will only fully recover if a negotiated deal is reached or the rest of the proposals are abandoned, he said.

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BP and Adnoc Bid $2 Billion for Israel Gas Group (8:38 am)

BP and Abu Dhabi National Oil Co. will set up a joint venture focused on natural gas and have made a non-binding offer to privatize Israel’s NewMed Energy worth around $2 billion.

Businesses reopening after unprecedented strikes (8:30 a.m.)

Israeli businesses and institutions are operating as usual after an extraordinary day-long strike that played a role in pressuring Netanyahu’s reversal.

Monday’s call to shut down the $530 billion economy was exceptional because it was backed not only by the Histadrut union federation, but also by private sector business leaders. International flights took off as planned on Tuesday after being grounded by strikes the previous day.

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US Envoy Praises Netanyahu, Awaits Biden Invitation (8am)

The US ambassador to Israel told Israel Army Radio he “assumes” President Joe Biden would invite Netanyahu to the White House after the Jewish holiday of Passover next month.

“I’m sure they will see each other in person soon,” said Ambassador Tom Nides. “Without question, he will come to the White House as soon as their schedules can coordinate.”

He said Washington welcomed Netanyahu’s decision to suspend his administration’s controversial proposal. “We wanted compromise and dialogue and I applaud the Prime Minister for announcing that,” he said.

Israeli Shekel Strengthens After Netanyahu Pause (7:06 am)

The Israeli shekel gained 0.9% against the dollar early Tuesday after Netanyahu paused his government’s controversial plan to overhaul the country’s judiciary.

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Polls Show Netanyahu’s Popularity Dented (7:00 am)

Polls conducted for Channels 11 and 12 showed Netanyahu would be unable to form a government if elections were held today, following the turmoil caused by the government’s proposed judicial overhaul.

The main reason would be a sharp drop in support for the Prime Minister’s party, which would win just 25 of the 120 parliamentary seats compared to its current 32.

Gantz Agrees for Presidency Talks (6:30 a.m.)

Opposition leader Benny Gantz has set up a negotiating team, Israeli media reported. Lapid said, “When the legislation really stops, really and completely, we’re ready to start a real dialogue at the President’s residence.”

—With support from Netty Ismail.